The failure to complete the Highway 275 project is costing Northeast Nebraskans money and motorists their safety.
The Nebraska Expressway system was announced in 1988, and the original deadline for its completion was 2003, said Norfolk Mayor Josh Moenning. Moenning was one of 21 area mayors who wrote a letter to the Legislature urging completion of the project.
The project’s goal is to connect the state’s larger cities and routes with higher traffic volume to the interstate system with continuous four-lane highways. But about one-third of the project remains unfinished.
To Northeast Nebraskans, the important section is the incomplete stretch of Highway 275 between Norfolk and Scribner.
The completion of this section would increase growth, save residents money and improve safety for motorists, according to a 2015 study by 4 Lanes 4 Nebraska.
Progress is slow, though. There is no estimated timeline for the start or completion of many of the remaining sections, although one opens for bids in the spring.
“The clock has been ticking for 33 years,” Moenning said of the project. “The can has been kicked down the road so many times. It’s a disservice to the taxpayers.”
The project is nearly 20 years past its due date, with the original deadline being 2003. One-third of the project is undone, and there is no timeline for many of the remaining sections. This means it could be decades before the project is finished.
The next part of Highway 275 to be completed will be the section between Scribner and West Point, which opens for bids later in the spring, said Jeni Campana, acting communication public policy director at the Nebraska Department of Transportation.
“We’re glad to know the Scribner to West Point portion may come to bid this spring,” Moenning said. “We’ve been down this road.”
Construction was supposed to start on this section in 2018, but the U.S. Army Corps of Engineers required the NDOT to conduct an environmental study on the area, delaying work.
Work may go ahead now that the study is completed.
Ideally work would begin in the fall, but it’s still unknown how long it would take to finish, Campana said.
“I don’t want to speculate,” she said. “We don’t have set dates yet.”
Many of the other unfinished sections are now under design, Campana said, and the rest are in planning.
Paying for the project
Moenning and the other mayors identified funding as the main reason behind the lack of progress on Highway 275 in their letter.
Nebraska could resolve this by issuing bonds to fund the project, they wrote.
“Cities must bond regularly to fund large infrastructure improvements. Many projects simply would not get done if we didn’t,” the mayors wrote. “Sadly, that is what’s happened with the highways the state promised to expand under the Expressway System. The money wasn’t stockpiled so the work simply did not get done, promises not withstanding.”
Nebraska is one of only two states that don’t issue bonds to pay for construction, the mayors said. This is because Nebraska is a pay-as-you-go state, Campana said. The state works within its budget each year and does not issue bonds to pay for construction projects.
As construction costs rise, it becomes more and more difficult for Nebraska to pay for infrastructure work without some type of financing, though, Moenning said.
“Being pay as you go is an anomaly among states,” Moenning said. “The longer you delay, the more expensive work on major infrastructure costs.”
But Campana said such an approach has helped keep Nebraska financially sound.
“Bonding is not something we have considered in many years,” she said. “We’re in a really good place.”
The NDOT is able to maintain 10,000 miles of roads and 3,500 bridges in part because Nebraska doesn’t use bonds, Campana said.
But Moenning said Nebraska is doing more damage by not investing in infrastructure.
“This outright opposition to taking advantage of lower interest rates now is a pennywise/a-pound-foolish approach. We’re letting politics get in the way of practical solutions,” Moenning said. “Sometimes we get in our own way by not investing in the future.”
Moenning said also that Nebraska isn’t truly a pay-as-you-go state anyway.
“It’s not true anymore to say that we’re a strict pay-as-you-go state,” he said. “There should be no illusions anymore.”
And it’s true that Nebraska has used a nontraditional way to finance at least one major project.
The state turned to a unique and complicated payment method to complete the Lincoln South Beltway project.
The state hired a construction company for the project. As part of the contract, the state will have to pay back the construction company over time, instead of paying the entire amount as the work is completed, said Chris Hawkins of Hawkins Construction Co., which was awarded the beltway project.
To pay for the project, the construction company went through another entity to issue bonds. These funds, along with a fixed cash payment by the state, are used to pay for construction, Hawkins said.
The difference is the state pays a fixed sum to the construction company rather than paying interest on bonds.
Though complicated, this works for big projects, Hawkins said.
“It works from our perspective,” he said. “It’s certainly something that can be replicated.”
This type of payment also would work for Highway 275, Hawkins said. In the current markets, this would be cheaper given the continual rise in construction costs.
Hawkins said each project has unique considerations, though, and the overall highway program cash flow would have to be taken into account as well.
Campana said the beltway was indeed a unique project.
“The project is also a completely new facility that would have been of little value to the public to have built in segments, so we needed to build it as quickly as possible to provide connectivity,” she said. “If we had built the project in the traditional manner, it would have taken the contractor eight or more years to build. The innovative process was used to allow the contractor to build the project in just three years.”
Still, the NDOT tried to used an innovative contracting method for the Scribner to West Point section of Highway 275 but did not get any reasonable bids, Campana said.
Abundance of benefits
One of the greatest projected benefits of the highway expansion would be increased safety, according to the study.
“We are losing, each year, more motorists on Highway 275 because it is crowded and it is dangerous,” Moenning said. “We’re putting the traveling public at risk.”
The average traffic deaths were almost 62% higher in Highway 275 counties than the rest of the state, according to the study.
The Federal Highway Administration estimated that converting Highway 275 to a four-lane divided highway would reduce accidents by 40% to 60%, according to the study.
The study also found that two-lane sections of Highway 275 see 52% more accidents per average daily traffic volume than the four-lane sections do.
There are potential economic benefits, too.
The study found that the expansion would add $1.2 billion to the state’s gross domestic product (in 2015 dollars) from expanded economic development. Additionally, the project would support an extra 1,315 jobs each year and increase state population by 2,987.
The construction alone would bring benefits to the state and region, the study found. Two years of construction on Highway 275 are likely to generate:
— $284.1 million to Nebraska’s overall economy.
— $94.6 million in wages, salaries and self-employment income.
— An average of 1,035 jobs for the period.
— $7.8 million in state in local taxes.
The presence of four-lane highways also would increase population growth, according to the study.
For example, from 1990 to 2010, counties along Interstate 80 had an average population growth of 11.6%, whereas non-I-80 counties saw an almost 10% decrease and Highway 275 counties saw a 6% decrease, the study found.
Moenning said highway access is a top concern for both people and businesses looking at Northeast Nebraska.
“One of the first questions is highway access,” Moenning said. “ ‘Do you have four-lane highway access?’ ”
Right now, and for the unforeseen future, the answer is no.